Nissan hit by new inspection scandal after Ghosn arrest: report

December 6, 2018

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A portrait of ousted Nissan chairman Carlos Ghosn is seen on a publicity billboard in his support at a street in Beirut on Thursday. Ghosn, born in Brazil of Lebanese descent, was arrested in Tokyo over alleged financial misconduct. He is facing further accusation of under-reporting his salary by about $35.5 million over the last three years. — AFP

TOKYO — Nissan plans to conduct another recall owing to "improper" tests on new vehicles, a newspaper said Thursday, dealing a fresh blow to the Japanese car giant following the shock arrest of former chairman Carlos Ghosn.

The latest issue was uncovered after Transport Ministry officials conducted on-site inspections at Nissan's major assembly plants, the Nikkei business daily said.

Several employees admitted they carried out "improper" tests on brake and other systems before shipment, the newspaper said, without specifying how many cars were affected.

Nissan plans to make an announcement on the case later this month and is considering recalling any vehicles improperly tested, it added. Immediate confirmation of the report was not available.

The manufacturer was forced to recall more than one million vehicles last year after admitting staff without proper authorization had conducted final inspections on some units intended for the domestic market before they were shipped to dealers.

In a separate case that erupted in July, Nissan admitted data on exhaust emissions and fuel economy had been deliberately "altered", hampering its efforts to recover trust after the inspection scandal.

If confirmed, it would represent another blow to the company, which has been rocked since Ghosn was arrested on Nov. 19 on allegations he under-reported his salary by millions of dollars over five years. Ghosn denies any wrongdoing.

The ousted chairman is expected to face a further accusation of under-reporting his salary by about four billion yen ($35.5 million) over the past three years, Japanese media reported.

On Tuesday, a Nissan Motor Co panel failed to nominate a successor to Ghosn as chairman in the wake of his arrest and dismissal for alleged financial misconduct last month, a source familiar with the situation told Reuters.

Ghosn could remain in detention until the end of the year as Tokyo prosecutors plan to rearrest him on a fresh claim of understating his income, the Sankei newspaper has reported.

Nissan has tasked a three-member panel of external directors with the selection of a new chairman. The panel includes Masakazu Toyoda — a former trade and industry official, Jean-Baptiste Duzan — a retired executive from Nissan's French partner Renault SA, and race car driver Keiko Ihara.

The panel plans to submit the name of a nominee at a board meeting on Dec. 17. Board changes must be approved by shareholders. The panel did not discuss any particular executive as a nominee at its meeting on Tuesday, the source said, adding the selection was put off because Duzan asked for more time.

Two other people with knowledge of the matter said Renault's board was meeting on Wednesday to discuss the leadership crisis. Ghosn continues to chair Renault's board, but was ousted from the position at Nissan and third alliance partner Mitsubishi Motors after his arrest on Nov. 19. — Agencies